Football teams and their respective governing bodies have long focused on three key pillars of revenue generation:
- Commercial Revenue: This traditional model involves companies investing in various elements such as front-of-shirt sponsorship, stadium sponsorship, and other items to promote official collaborations and joint sponsorship campaigns.
- Matchday Revenue: This includes revenue from paying customers attending matches at the stadium, which encompasses concessions and official merchandise sales.
- Broadcast Revenue: This category pertains to the fees paid by broadcasters to air games, either in the country of origin (domestic) or abroad (international).
Throughout most of the 21st century, broadcast revenue has remained robust. The English Premier League, in particular, paved the way for continuous contract renewals with substantial increases. While Europe’s other top five leagues (La Liga, Serie A, Bundesliga, and Ligue 1) experienced growth at a slower rate, there was an expectation that broadcast agreements would always increase over time..
But post-coronavirus, the landscape has changed.
Various market forces have combined to create the most volatile environment for sports governing bodies in the modern era.
The renewal of TV rights for many of the major football leagues in Europe are on the horizon as the current cycle is concluding. The Premier League, being the dominant force, is likely to emerge relatively unscathed, but only by increasing the number of games available in their live package from the current 200 to 270. Meanwhile, Ligue 1 has postponed its tender while it strives to secure an offer aligned with its market value.
But as Serie A has found out, what you desire and what is available are often quite far apart. The league aimed to increase its current €927 million annual domestic agreement to over €1 billion but ultimately negotiated a 3% decrease to €900 million per year with DAZN and Sky Italia. This agreement spans five years, contrary to the traditional three-year term. More years, for less money.
So, what should leagues do when their conventional revenue streams are stagnating or diminishing? They must look to transition into digital and technological innovators as the landscape changes. They should explore alternative methods to market the sport that extend beyond outdated exposure and profit margin models, utilizing technology wherever possible.
When teams face revenue constraints, it becomes imperative to optimize every facet of their business. This means ensuring their star players remain fit and available for as much of the season as possible. After all, the best players on the field lead to a better product. Leagues can no longer afford to be complacent about acceptable levels of player availability, statistical analysis, or any method that fails to maximize their available assets.
Serie A is taking a shrewd approach by innovating in areas where other leagues are not. They have partnered with sports technology company Math&Sport (M&S) to offer teams a unique perspective in sports analytics.
Zone7, who worked in collaboration with Napoli during their league-winning season and have recently announced a three-year extension of their partnership, will work with M&S and their innovative ‘Im Coach’ application, which was installed onto tablets and offered to the coaching departments of all Serie A teams for in-match analysis.
M&S harnesses mathematical models and analytics to provide real-time performance insights, coaches, and players. This has given Serie A teams a unique in-game perspective on the action, one that can positively impact their decision-making ability.
Now, with Zone7 on board, teams will now also be able to benefit from game day player health and readiness insights powered by Zone7’s state of the art artificial intelligence platform. It shows that Serie A are committed to finding ways to maximize their performance levels of teams on the pitch, but are also very much aware that player health and wellness remains of paramount concern.
Serie A is not alone in exploring new avenues to enhance their product. La Liga, which launched La Liga Tech (now Sportian), has created a comprehensive digital platform aimed at assisting its members with various tools, from anti-piracy software to enhanced data visualization. It’s only a matter of time before they also focus on performance data and improving the availability of their top players.
When you think about the impact of player availability, look no further than the impact Bayern Munich’s Kim Min Jae has had on the Bundesliga’s recent broadcast renewal with Coupang. This is another league that has begun to embrace innovation but yet to do so with regards to load management.
Football governing bodies are coming to the realisation that the market for attention is more competitive than ever, and the landscape will continue to change. But one thing is certain: fans desire to witness the best players performing at their peak regularly. Serie A’s forward-looking vision positions them as innovators in this rapidly evolving space, setting the stage for the future.
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